Amersham, the medical technology company that grew out of the Government's atomic energy programme, is creating a new joint venture for its prostate cancer treatment business.
The company has been stung into action after falling sales of "brachytherapy seeds", small radioactive balls which are implanted in the prostate to kill cancer cells.
There is a growing awareness of prostate cancer as one of the most prevalent cancers in men, with more than 200,000 new cases diagnosed every year in North America alone. But Amersham's sales of brachytherapy seeds fell 13 per cent to £62m last year because of intense price competition.
Sir William Castell, Amersham's chief executive, said yesterday that the company and Galil Medical, an unquoted Israeli company, were merging their urology businesses. The deal gives Amersham control of a new generation of prostate cancer treatments. Galil's innovative "cryotherapy" products inject iceballs into the prostate to freeze cancer cells. The therapy has regulatory approval for use in Europe and the US, and health authorities on both sides of the Atlantic have agreed to fund it.
Amersham will hold 75 per cent of the joint venture, which will be based in the US, and contribute the bulk of the new company's salesforce. Its chairman will be drawn from the Amersham side, but a chief executive is yet to be appointed.
Sir William said: "Cryotherapy is a new but rapidly growing technology, increasingly used to treat advanced stages of prostate cancer or recurrent disease. It complements the effective first-line brachytherapy – radiation seed therapy – in which Amersham is market leader."
Amersham's shares were up 1.75p to 432.5p. They have fallen by almost a quarter this year after a string of setbacks, including the disappointing brachytherapy sales and the falling value of the dollar. The company is also shedding 400 staff because of a slide in sales of science laboratory equipment to drug companies.